In California, as in many other states, executors have a legal responsibility and a fiduciary duty to uphold the laws of the state as well as the terms of anything they are administering. California executors are held to a strict fiduciary duty, meaning that they should take actions that a reasonably prudent person would take in similar situations. Executors must also be honest and fair with regard to their dealings and act impartially.
This means that an executor cannot use their unique situation of having access to all of the estate assets to secure their own financial benefits that extend beyond the typical payment owed to the executor for their services of an estate administration. For example, an executor is not allowed to sell a piece of real estate in the decedent’s estate to themselves at below market price. This is considered dishonest and an unfair act. Any breach of fiduciary duty exposes that executor to potential personal liability, and perhaps criminal penalties.
This means they could be held accountable for significant damages if someone can show that the executor has overstepped their bounds or otherwise violated their duty. This is why many executors need to be briefed about their responsibilities prior to stepping into this role and should take necessary steps to document everything they do to prevent them from facing issues of personal liability. If you have further questions about how the process works and what to think about before naming an executor, contact our experienced Pasadena estate planning law firm to discuss your unique situation and to craft a comprehensive estate plan.
